Speaking at Lloyd’s of London, Bernard Twomey and Jonathan Earthy of Lloyd’s Register addressed the Lloyd’s Market Association Marine Forum on "Cyber: Marine Risk and Potential Impact".

They explained that the threat to the marine sector - from malicious attacks on systems and organisations via information technology - is real. But cyber losses may also be related to the use or misuse of systems which contain software as a significant component for their effectiveness and safety.

Presentation was about the consequences of insufficient maturity in the marine sector using information technology. LR’s intention was to inform a discussion on how the marine insurance industry could best address and manage these risks.

LR explained that cyber-attack is only one of several threats associated with the use of software as a technology in the marine environment. Examples of incidents arising from system complexity, software upgrades, inadequate requirements, unexpected behaviour and incomplete testing were used to demonstrate the potential risks.

Causes of problems include: poor software specification or definition of requirements, inadequate system integrity, ineffective installation, ineffective update/maintenance, malicious attack, corruption, lack of usability and insufficient or inappropriate training.

The consequences of these problems include: loss of control (failure of high integrity systems, ship and platform), reduced reliability or availability of any system, impact on safety (degraded/unknown margin of safety), high cost of ownership (poor ROI/productivity, high downtime, off hire time for repair), loss of data (both accidental and malicious), damage to ship systems, incorrect reporting of regulatory information and increased number of incidents with damage to ships, cargoes and the environment).

LR’s Jonathan Earthy concluded that, "cyber loss is real, here to stay and the technology needs to be better managed in order to contain the risks. Awareness raising and training are required. Loss prevention has a part to play. We also need better statistics on the causes and impact of cyber loss."

The LMA Marine Committee oversees the work of the technical committees (Joint Hull, Cargo, Liability, Specie & Excess of Loss). These committees are considering the implications, if any, from a marine risk perspective arising from cyber-attack and similar events.

You can download a copy of the presentation here.